CoinGate’s Crypto Payments Report & Industry Insights (H1 2024)

The first half of 2024 is already in the rearview mirror, and cryptocurrency payments continue showing strong signs of vitality and present valuable insights. 

It has been a dynamic period for us and crypto users in general. We’ve seen notable shifts in payment currency preferences, growth in blockchain networks, an increasing adoption of stablecoin payments alongside stablecoins like Circle’s USDC becoming MiCA-compliant, and more.

Here are key takeaways from the following report:

• USDC gets regulatory approval: USDC becomes the first regulated stablecoin in the European Economic Area (EEA), meanwhile CoinGate applies for the Circle Alliance Program.
• Solana’s immediate popularity: Since its integration with CoinGate in May, Solana has processed nearly twice as many USDC orders as the BSC network.
• Litecoin’s fast growth:  Litecoin payment count grew by 67% year-over-year.
• Record highs for Lightning Network: The Lightning Network is experiencing all-time high record usage compared to the mainnet.
• SHIB surge: SHIB orders increased by 76% following a community push to add SHIB support on BSC and Polygon.

Think it’s about time to accept crypto payments in your business? Take the first step and sign up at CoinGate.

The Current State of Crypto Payments at CoinGate

In Q2 of 2024 alone, CoinGate processed a total of 404,674 orders. 

For comparison, in 2023, CoinGate processed an average of 323,514 per quarter. This represents a 25.09% increase over the last year’s quarterly average. 

Here’s a deeper dive into our H1 where we overview of the most popular cryptocurrencies, blockchains, performance of recently implemented Layer 2 solutions, topped up with industry insights, quarterly data comparisons, and more. 

Let’s break the data down and digest the impact:

Stablecoins Payments Retain Dominance; USDC Becomes MiCA-Compliant

One of the most notable and impactful events recently was Circle, an issuer of USDC and EURC stablecoins, getting a license in Europe and ensuring its compliance with stablecoin provisions under European Union crypto laws. 

This makes Circle the first global stablecoin issuer to achieve MiCA (Markets in Crypto-Assets) compliance, which is why CoinGate is excited to see what impact this will have on USDC adoption for payments. 

Interestingly enough, USDC obtaining e-money licenses has boosted its demand significantly with its market share reaching a record high. Similar trends can be noticed on our side as well. In both Q2 and over the last year, stablecoins have solidified their position as a preferred payment method:

• USDC payments in Q2’24 increased by 24% compared to Q1’24 and an impressive 94% year over year.
• DAI payments rose by 9% compared to Q1’24 and 37% compared to Q2’23.
• USDT continues leading the pack overall, accounting for 34.2% of all orders in Q2’24, although still mostly used on the TRON network. 

USDT payments in particular dominate nearly all our supported networks. On BSC, USDT payments account for 63.76% of total, on Tron – 70.46%, and on Ethereum – 20.79% of all payments made through CoinGate. 

This trend shows the continuously growing demand for an ability to pay with stable digital currencies, as they prove to be fast, cost-effective, protect from price volatility, and thus are more convenient than alternatives. With the recent regulatory approvals, stablecoins are bound to take a bigger role in finance.

Immediate Popularity of Solana Network

One of the most notable changes this quarter is the rise of the Solana network. 

We integrated Solana back in May of this year. In June, Solana was already the 6th most preferred network for payments, and continues to grow its payments share week over week.

In June, Solana had already processed nearly twice as many USDC orders as the BSC network and accounted for 3% of all orders processed that month. 

Whether it’s because of the network’s high throughput or low transaction costs or other reasons, Solana’s skyrocketing performance is exciting to witness, and we will definitely keep an eye on how it trends further. 

As we will soon introduce support for more cryptocurrencies on the Solana network, we expect its prominence is likely to continue rising.

Insights into Bitcoin and Lightning Network Payment Data

While Bitcoin payments count saw a decrease of 5% compared to Q1’24 and 34% year over year, the adoption of the Lightning Network (LN) has reached new heights:

• In Q2, 16.6% of BTC payments through CoinGate were processed by LN, setting a quarterly record.
• June was a record month, with 18.5% of Bitcoin payments processed via LN.
• Compared to last quarter, LN payment count increased by 33%.

The growing use of the Lightning Network among people who spend cryptocurrencies on goods and services shows that more wallet providers are offering easy access to the Lightning Network, and people are becoming more comfortable using it, a trend that is unlikely to reverse.

Litecoin’s Continued Success

Litecoin (LTC) has shown considerable growth this quarter. Litecoin payment count in Q2’24 increased by 3.43% compared to last quarter and surged by 67% year over year. 

Alan Austin, Managing Director of the Litecoin Foundation, attributes this to Litecoin’s superior transaction experience. He stated:

Shiba Inu’s Growing Influence

Following strong community demand, in Q2 we introduced support for SHIB payments over Polygon and BSC networks.

We love SHIB! ❤️

To prove that, we have added #SHIB support for #Polygon and Binance Smart Chain.#Shibarmy, use your $SHIB to book Airbnb, grab the latest games from Steam & PS5, refresh your wardrobe with Nike & Zalando and more!

Explore all options: https://t.co/bhrB9i7OrF pic.twitter.com/2dS2JVD3V8

— CoinGate (@CoinGatecom) May 10, 2024

As a result, this move significantly impacted overall SHIB order volumes, with SHIB orders increasing by 76% compared to Q1’24. 

The SHIB community’s enthusiasm speaks volumes of the coin’s popularity, and we are excited to take part!.

Rising Stars: BSC, Polygon, and Arbitrum

Since their integrations in early 2023, Binance Smart Chain (BSC), Polygon, and Arbitrum have climbed the ranks of preferred blockchains and Layer 2 protocols for payments. 

Here are the highlights and overall Q2 performance:

• BSC: Jumped to the 4th place, making up 11.4% of total transactions in Q2 2024.
• Polygon: Moved to the 6th place, representing 1.8% of total transactions in Q2 2024.
• Arbitrum: Progressed to the 7th place, accounting for 1% of total transactions in Q2 2024.

This sudden and upward trend shows a lot of promise for Ethereum’s Layer 2 solutions as many start taking advantage of their versatility in day-to-day transactions.

Wrapping It Up

Q2 of 2024 has surely been an eventful period for cryptocurrency payments. 

The rise of Solana, the consistent growth of Litecoin and Tron, the increasing adoption of stablecoins, and the record performance of the Lightning Network all point to a vibrant and evolving ecosystem. 

The leading position of the Tron network, the growing adoption of the Lightning Network and huge appreciation of Solana and SHIB also suggest that the community’s focus shifts towards transaction efficiency and cost-effectiveness. 

But stay tuned for more updates like this! If you want to be part of this growth, consider accepting cryptocurrency payments in your line of work. 

The best way to start is by signing up for a CoinGate account.